Shownotes
Wayfair's luxury brand Perigold opens a massive 30,000-square-foot, two-level store in West Palm Beach! Sponsored by the A&M Consumer and Retail Group, Mirakl, Ocampo Capital, Infios, and Quorso.
The new location features 150+ luxury home brands, a dedicated sleep center, and expanded kitchen appliances—with many products available to take home or ship within a week (remarkable for furniture!). But is this Restoration Hardware-esque flagship profitable?
Manola Soler initially questions the four-wall economics before coming around on the brand-building exercise and quick-turn inventory model. We debate whether Wayfair should have showcased a mix of Perigold's luxury offerings with more accessible Wayfair products—creating a high-low concept no one else in furniture can match. Plus, Lisa emphasizes why planning is the central nervous system that makes these physical experiences work.
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#wayfair #perigold #luxuryretail #furniture #westpalmbeach #retailstrategy #omnichannel
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Transcripts
Wayfair's luxury brand Paragould is going big in Florida with its new store debut.
Speaker A:Wayfair has opened its second Paragould banner store, a nearly 30,000 square foot, two level location at City Place in West Palm Beach, Florida.
Speaker A:I know that's Ann's favorite vacation spot in Florida.
Speaker A:The opening follows the luxury brand's brick and mortar debut earlier this year in Houston.
Speaker A:And it also comes as Wayfair is expanding its namesake brand with a large format concept.
Speaker A:The store houses More than 150 luxury home brands across furniture, decor and lighting, with many products available to take home or ship within a week.
Speaker A:Also unique to the West Palm beach store is a dedicated sleep center where customers can explore premier bedding in a boutique like setting.
Speaker A:The store also offers an expanded assortment of kitchen appliances, offering shoppers the chance to experience luxury kitchen design solutions firsthand.
Speaker A:Manola.
Speaker A:3,000 square feet for a new Wayfair Paragould store is pretty darn big.
Speaker A:Would you have greenlit this idea?
Speaker B:I mean, you know my, my first reaction when I saw that, I was like, ooh, I want to go there.
Speaker B:And then my kind of business came on.
Speaker B:I was like, there's no way that's profitable on like a four.
Speaker A:Really?
Speaker B:That was my gut reaction.
Speaker B:Right?
Speaker B:Yeah, you know, I think there's a couple interesting things, right?
Speaker B:It's kind of, we've seen other players in kind of that luxury space, you know, Restoration Hardware, build these kind of mega flagships, you know, very high finishes, very expensive real estate.
Speaker B:Big, big moments.
Speaker B:I, I think it's a brand building exercise in some sense.
Speaker B:But the other thing that caught my attention is when they get to talking a little bit about the, you know, there's product that you can take home.
Speaker B:That day I was like, oh, maybe it's like a luxe IKEA situation, right, where they're monetizing the, the experience a bit more.
Speaker B:And I think another thing that was interesting is, you know, they're saying a lot of the inventory being available, you know, a week out, that's remarkable.
Speaker B:Honestly, if you try to buy furniture anywhere else, you know, high end, lower end, it can be months, right?
Speaker B:And then you're sitting, you don't have a sofa, you know, you're sitting on the, on the ground for a long time.
Speaker B:So I, first, I want to go check it out.
Speaker B:Second, maybe they are, you know, able to make it profitable with this mix of, you know, in stock product that you can take home or product that is quick turn and you know, people are shopping and needing These pieces of furniture.
Speaker B:And, you know, sometimes it's like, if I can get it, you'll change your mind and buy it there.
Speaker B:Also thought the sleep was interesting because we had seen a lot of kind of going digital for the sleep category.
Speaker B:Right.
Speaker B:With all these kind of memory foam mattresses and whatnot.
Speaker B:But the more traditional sleep category is pretty neglected.
Speaker B:Right.
Speaker B:It's hard to.
Speaker B:There's not that many places to go find a mattress, and it's a big ticket item.
Speaker B:So I think, you know, it.
Speaker B:Maybe I would have greenlit it.
Speaker B:Yeah, it's.
Speaker B:I was.
Speaker C:Yeah.
Speaker A:Okay.
Speaker A:Coming back around.
Speaker B:Coming back around.
Speaker A:Yeah.
Speaker A:You're bringing up some interesting points on the scale side of things too.
Speaker A:But so I'm curious because you mentioned it when you first looked at the pictures in the article, did you immediately think, wow, this is kind of like RH Ask Restoration Hardware, Ask in terms of what they're going for.
Speaker B:It did give me that.
Speaker B:That sense.
Speaker B:They have a different aesthetic, but it has that kind of very grand, very.
Speaker B:You know, I took my kids to the RH store here in the.
Speaker B:In the meatpacking district, and they were like, mommy, what is this museum?
Speaker B:You know, they're like, oh, this is, like, so, you know, grand.
Speaker B:And it has that, like, very upscale feel.
Speaker B:I think this has, you know, nods to that.
Speaker B:Right.
Speaker B:It feels.
Speaker B:It feels grand.
Speaker A:Right, right, right.
Speaker A:Okay.
Speaker A:Got it.
Speaker A:And did you feel that way too?
Speaker A:And what was your take?
Speaker D:I. I keep going back and forth on this one.
Speaker D:I mean, I feel like on one hand, I like that there it.
Speaker D:This is really bringing a marketplace of brands together in one store.
Speaker D:It's, you know, it's independent retailers like Blue Dot, one of my favorite furniture designers.
Speaker D:Like, it's giving me the opportunity to see a vignette in a furniture store that's pulling from a lot of small, smaller, like sometimes D2C brands in one spot.
Speaker D:So I liked that component of it.
Speaker D:But I think if I was Wayfair, I think that especially in West Palm beach, like, you're sitting on rows and rows and rows of high end luxury furniture stores like rh, like Manola's talking about, I almost wonder if I wouldn't have gone with a more cohesive Wayfair brand strategy.
Speaker D:So not just Paragould, but also, like, giving people the opportunity to, like, cross categories a little bit more.
Speaker D:So, like, maybe you don't need a $7,000 lamp next to your $15,000 couch.
Speaker D:Like, could you have a lamp from another?
Speaker D:Like, could you use this as a real opportunity for the designers at Wayfair to like, create a room that's a good mix of high and low, because I think that's how real people shop.
Speaker D:I don't think that most people are going into RH and they're like, buy the whole room.
Speaker D:I'll, you know, here's, you know, hundreds of thousands of dollars.
Speaker D:So I think if I was Wayfair, I think the more differentiating point here would be how do I showcase my product in a luxury street environment in West Palm beach, but show that there's, like, you can have the best of both worlds.
Speaker D:You can have a low end and a high end in the same room and, and have an affordable, very beautiful looking room.
Speaker D:So I think I would have.
Speaker D:I would have gone beyond just the.
Speaker D:The one brand.
Speaker A:Hmm, interesting.
Speaker A:See, See, I think from a merchandising perspective, what you're talking about is really hard to do.
Speaker A:It's really hard to show luxury alongside value.
Speaker A:And so I think that that's a tough concept to me.
Speaker A:And I'm curious because I want to go to Lisa too, and see if we continue to share the same brain here on this podcast and a numerous podcast now at this point, like, to me, it's.
Speaker A:To me, this is a signal that.
Speaker A:And I think it's a good signal that Wayfair doesn't know what its identity is in the physical world.
Speaker A:They've got the big play against Ikea, where they're seemingly going after that they're continuing to expand it, and now they've got this play in the territory where they're like, look, it's funny, there are, to me, it's funny that all of our minds went to restoration hardware, because restoration hardware, there's a lot of margin in restoration hardware that they could go after.
Speaker A:It's very similar to any of, like, the mom and pop furniture stores that you see everywhere else that play in the luxury space.
Speaker A:So it's not really that differentiating.
Speaker A:Feels like they're trying to take a little bit of a piece of the Williams Sonoma angle here too, with the appliance side of things.
Speaker A:And so, like, okay, yep.
Speaker A:Could it work?
Speaker A:Could you grab some of that share in the luxury market?
Speaker A:Because the other important thing here that they can do better than anyone is they have the national scale of their logistics behind them to get the product to them quickly, to get the service that you need around, like knowing when your delivery comes, because that's a big pain in the butt when it comes to furniture.
Speaker A:So.
Speaker A:So I like this as an experiment and who's to say in the long run, you know, does the large store IKEA play out as the way to go?
Speaker A:Does the luxury play play out as the way to go?
Speaker A:Is there something else that they can concept or come up with?
Speaker A:But for that reason, I'm with Manola.
Speaker A:I think ultimately I greenlight this.
Speaker A:But Lisa, what do you think?
Speaker C:My first reaction was, yes, I greenlight it only as a test and learn.
Speaker C:Which I think a little bit, Chris, is what you're saying is what do I this so that I can figure out what the next expansion play is.
Speaker C:My mind, like the three of you went to.
Speaker C:RH is struggling with those museums financially.
Speaker C:Right.
Speaker C:So they better take a chapter in learning from that thinking about the locations they went to.
Speaker C:Right.
Speaker C:As another thought, I love the test and learn.
Speaker C:But Ann, what I will say what I did jive with with what you said, even though Chris said it would be hard to do.
Speaker C:I think the best retailers from a merchandising perspective, if they could figure out how to show the high low, could be a huge unlock.
Speaker C:Because if you.
Speaker D:There's no one else doing it.
Speaker D:Yeah.
Speaker C:And not even in apparel.
Speaker C:Right.
Speaker B:In a.
Speaker C:In a way that shows up and that is what the consumer does.
Speaker C:And I think, you know, we go back to our conversation about the high street is how do you blend that?
Speaker C:Because the kids, the Gen Zs, are figuring out how to mix, you know, kind of bargains with their best pieces, especially going and hitting up the vintage stores and things.
Speaker C:So I think if someone can figure it out in any category, I think it could be quite an interesting play to be a competitive advantage for Wayfair in the, in the furniture space.
Speaker C:Because while they're competing with Ikea, but now they're trying the luxury high end, how do they blend it?
Speaker A:Right.
Speaker D:And no one else can do that besides Wayfair.
Speaker D:I mean, no one else has that assortment that can, that can offer up, you know, RH won't.
Speaker D:IKEA can't go up market like that.
Speaker D:Like it's.
Speaker D:They're the ones, the only ones who can do it right now.
Speaker C:It's like the house of brands.
Speaker C:Right.
Speaker C:I love that idea too.
Speaker D:Yes.
Speaker A:Well, and then the question is, do you invested it in physical stores or did you just play up that angle online too?
Speaker A:Right.
Speaker A:That's the other $64,000 question here, which I don't know the answer to.